| To: Glenn Petersen who wrote (82) | 7/8/2011 9:11:43 PM | | From: John Vosilla | | | | Good move. Got lucky on the one day runnup in RJET and got out the next day when it failed to break the highs. Strange times with the transports at new highs yesterday even with oil prices back up the past few weeks.. A stronger economy with much higher oil prices later this year would not make this the sector to be in though.. A continued sluggish economy with declining oil prices is what I'd bet on though..Looking to get back in some airline but want some strength in UAL first..
finance.yahoo.com |
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| To: Glenn Petersen who wrote (83) | 7/8/2011 9:16:37 PM | | From: John Vosilla | | | | | What I like is so much capacity was taken out of the system the past decade and even in the dark days of 2008-09 seemed most flights were packed.. It really is all about the price of oil IMHO.. |
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| From: Glenn Petersen | 9/2/2012 4:37:11 PM | | | | | | Everything carries a price in this business climate
With airlines leading the way, a la carte fees help boost profits
Phil Rosenthal
Chicago Tribune
September 2, 2012
By now, the idea of airline baggage charges, extra legroom at a cost, paying for food and so on, has become for travelers a bit like the preflight safety spiel about how seat belts work.
It may annoy. Or perhaps it has become so common that it no longer elicits much response. But these transactions are helping keep the planes flying, and they illustrate a market reality increasingly faced by a wide spectrum of consumers and businesses.
"Back out that ancillary revenue and some airlines that posted profits would not just have posted losses but significant losses," Henry Harteveldt, chief research officer and co-founder of California-based Atmosphere Research Group, said Friday in an interview.
Efforts by airlines around the world to increase revenue apart from ticket prices have grown almost tenfold since 2008 to $22.6 billion, according to a new study by IdeaWorks Co., a Wisconsin-based industry consultant. And, even with that, the International Air Transport Association is projecting overall global airline profits will be down in 2012 for a second successive year to about $3 billion.
That's a profit margin of just 0.5 percent, so what some see as nickel-and-diming is viewed within the turbulent airline industry as pennies from heaven.
"The whole economics of the business have been an absolute disaster since the fuel crisis of 2008," IdeaWorks President Jay Sorensen explained. "Airlines are just desperate for money."
The economy has ensured that this desperation is not unique to airlines or even the travel business, where hotels may look to charge for a Wi-Fi connection that Starbucks will give you for free, or assess a resort fee on top of the cost of whatever the resort's room rate is and maybe tack on a housekeeping surcharge.
You see this batteries-not-included mentality elsewhere, with customers reeled in by a low introductory price and then given the upsell pitch. Cellphone companies that once touted all-inclusive services look to sell data and voice separately. Banks try to assess new fees to cover costs they once absorbed.
Strap yourself in for more — at least for a while.
"In an industry cycle, in the beginning, when you're in a high-growth period, you tend to see a lot of bundling, giving a lot of things at one price," Jean-Manuel Izaret, a partner and managing director of the Boston Consulting Group, heading their pricing practice, said by phone. "At the other extreme, when you are in the super-mature area, you'll have low-cost providers entering certain markets with no-frills offers.
"If (the legacy companies) price above (the newcomers), everybody goes to the low-price guys, and if you match the price but with the frills, you lose money," Izaret said. "So in a mature market, where low-cost challengers have come in and undercut the prices of established players, the only option for established players is to unbundle and price every little thing separately."
Then after a while, another maverick tries to cut through the clutter and simplify matters for consumers, by offering several a la carte services for one fee. Maybe a carmaker touts simplified pricing. Others follow. The cycle continues.
"Airlines are … going to have to be careful of nuisance fees, like checked bags and seating, and focus instead on inventing services that have not been offered before that people value," Sorensen said.
That value proposition is critical. But within a company the ability to generate revenue through a service often means more resources will be devoted to improving it. So the baggage service, for example, not only has benefited from fewer checked items in the system but greater investment in that system by airlines.
"Air fares consistently trail the rate of inflation," United Airlines spokesman Rahsaan Johnson said in an email. "Charging for specific services like baggage handling lets us invest to provide greater reliability for those who check a bag, without passing on the cost to customers who don't."
According to IdeaWorks, Chicago-based United gets 13.9 percent of its revenue from ancillary streams like baggage fees, premium coach seating and cash paid by companies offering bank cards with benefits like frequent-flier club points and waiver of fees.
"Airlines seem more prone to disclose this information because it's a hot topic in the investment community. It's something that's now expected by analysts," Sorensen said.
It's also helpful motivation for employees, who understand why they're hawking snacks.
Those flight attendant/beer vendors are right to feel sheepish.
"I have seen over time consumers expressing their dissatisfaction with a la carte fees, particularly the growing trend of having to pay extra for window and aisle seats," Erin Bowen, a Purdue University professor and lead researcher for the Airline Passenger Survey, said by email. "A la carte pricing looks more like hidden fees or 'nickel and diming' to many people — and it doesn't endear the airlines or invoke loyalty in passengers."
An April TripAdvisor survey of more than 1,000 Americans found 41 percent identified more legroom as the greatest improvement airlines could make, but 71 percent said they wouldn't pay for more legroom on flights less than four hours long. Even for longer flights, only 35 percent said they would pay at least $25 for that space.
What ticket buyers tend to seek first as they check options online — for business travelers, often as a policy — is a cheap fare.
Unless that changes, there is plenty of incentive for airlines, and other industries, to take on the baggage of consumer disenchantment with add-on charges.
"Any consumer who thinks there's a free lunch has to understand there's always a cost," Sorensen said. "Something has to give."
philrosenthal@tribune.com
Twitter @phil_rosenthal
Copyright © 2012, Chicago Tribune
chicagotribune.com |
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| From: Glenn Petersen | 12/24/2012 6:05:14 PM | | | | | | For United, Big Problems at Biggest Airline
By JAD MOUAWAD
New York Times
November 28, 2012
CHICAGO — It was supposed to be a moment for celebration: United Airlines observing the delivery of its second Boeing 787 Dreamliner with a flight from Seattle to Chicago earlier this month for a select group of employees, while senior officers, including Jeffery A. Smisek, United’s hard-charging chief executive, served Champagne and took lunch orders.
But before the flight took off that morning, a computer glitch in one of the airline’s computer systems delayed 250 flights around the world for two hours.
So it goes at United these days. The world’s biggest airline, created after United merged with Continental Airlines in 2010, promised an unparalleled global network, with eight major hubs and 5,500 daily flights serving nearly 400 destinations. As an added benefit, the new airline would be led by Mr. Smisek of Continental, which was known for its attention to customer service.
But two years on, United still grapples with a myriad problems in integrating the two airlines. The result has been hobbled operations, angry passengers and soured relations with employees.
The list of United’s troubles this year has been long. Its reservation system failed twice, shutting its Web site, disabling airport kiosks and stranding passengers as flights were delayed or canceled. The day of the 787 flight, another system, which records the aircraft’s weight once passengers and bags are loaded, shut down because of a programming error.
United has the worst operational record among the nation’s top 15 airlines. Its on-time arrival rate in the 12 months through September was just 77.5 percent — six percentage points below the industry average and 10 percentage points lower than Delta Air Lines. It had the highest rate of regularly delayed flights this summer, and generated more customer complaints than all other airlines combined in July, according to the Transportation Department.
The airline even angered the mayor of Houston, Continental’s longtime home and still the carrier’s biggest hub, when it unsuccessfully sought to block Southwest Airlines’ bid to bring international flights to the city’s smaller airport, Hobby.
The United-Continental merger is weighing on the company’s finances. It took a $60 million charge in the third quarter for merger-related expenses, including repainting planes. It also took a $454 million charge to cover a future cash payment to pilots under a tentative deal reached in August.
While most large airlines reported profits this year, United has lost $103 million in the first three quarters of 2012, with revenue up just 1 percent to $28.5 billion. Its shares are up 7 percent this year compared with a 12 percent gain for the Standard & Poor’s 500-stock index and a 24 percent gain for Delta.
“United remains at a challenging point,” analysts from Barclays wrote last month, and they forecast that the carrier would not begin to see the benefits of its merger until late in 2013 and into 2014. Still, while airlines initially struggle, mergers increase revenue eventually, as the example of Delta’s acquisition of Northwest Airlines demonstrated two years ago.
Mr. Smisek, taking a break from serving coffee halfway through the maiden 787 flight, acknowledged that things were not going as fast as expected, particularly given the aggressive targets he set two years ago. Back then, Mr. Smisek said the merger would be wrapped up in 12 to 18 months. He has since learned to be patient, he said.
“It is still a work in progress,” he said. “The integration of two airlines takes years. It’s very complex. If you look at where we were two years ago, we’ve come a long way.”
Admittedly, the process is complicated. Airline mergers mean combining different technologies, often old computer systems, as well as thousands of procedures used by pilots and flight dispatchers, gate agents, flight attendants and ground crew.
Setbacks are common. Like United, US Airways experienced a breakdown in its booking technology after its combination with America West in 2005. Delta’s on-time performance fell sharply in the year after its purchase of Northwest.
But today, Delta is a leader among big airlines in on-time performance. US Airways had a record third-quarter profit even though it still lacks common work rules for its pilots seven years after its merger.
United has completed many of its merger tasks, particularly as far as passengers are concerned. It has received its single operating certificate from the Federal Aviation Administration, allowing it to run a combined fleet. Despite all the problems this summer, it claims to have finally merged the reservation and technology systems.
Mr. Smisek said passengers would see the benefits of the combination by next year as United introduces new features on its planes, including satellite-based Wi-Fi, flatbed seats in business class and bigger overhead bins on its fleet of Airbus narrow-body planes.
One of the remaining sticking points, however, is getting employees of the two merged carriers to agree to a single contract. Pilot unions signed a tentative agreement with the company in August, after months of bitter negotiations. Talks are continuing for agreements with unions representing flight attendants and mechanics.
“There always seems to be some bump in the road,” said Ray Neidl, a senior aerospace and airline analyst with the Maxim Group. He said much of the merger’s benefits would kick in after the airline got its collective agreements with its work force. “Once they get these challenges out of the way, United will be a powerhouse.”
For many analysts, United’s real challenge lies in combining different work groups with different cultures, values and ways of doing things.
That is particularly true for United, which had a history of sour labor relations, and Continental, long considered one of the nation’s best-run airlines.
“You know, the cultural change takes time,” Mr. Smisek said. “And people resist change. People are sort of set in their ways.”
He added the airline was now intent on providing better operational performance and consistently good customer service. “And there are people who don’t like that,” he said. “I understand that. What I want is those people to either change or leave.”
There are few lasting advantages in the airline business. Airlines can easily match what rivals are doing, whether by lowering fares, buying new planes or installing new features on their aircraft. But United insists that its network remains its most resilient strength and will help it attract more passengers.
The carrier’s dominant market share at Newark Liberty International Airport, for instance, appears unassailable and provides a formidable gateway to the New York and East Coast markets. United’s Houston hub is a major jumping point to Latin America. And United is the biggest carrier in San Francisco, giving it an advantage in the Pacific, where it is the biggest American carrier.
United is counting on new planes to make a difference in coming years. It has made a big bet by ordering 270 planes over the next decade, including 50 Boeing 787s and 25 Airbus A350s.
The 787’s long-range ability and relatively smaller size will allow United to add new direct service between cities that did not have enough traffic to justify bigger planes like the Boeing 777. Its 787s will fly between Houston and Lagos, Nigeria, starting in January, followed by service from Denver to Tokyo’s Narita airport in March, and from Los Angeles to Tokyo and Shanghai.
United is betting that passengers will be drawn by those new services as well as by the 787’s carbon-fiber technology, which allows higher levels of humidity and oxygen in the cabin and can, Boeing claims, help reduce jet lag-related fatigue.
The airline moved its headquarters to the Willis Tower in Chicago last year. In June, it set up a new Network Operations Center, occupying a full floor in the tower in a vast open space previously used as a trading floor. From here, managers run daily operations, overseeing flight schedules, crew availability, weather forecasts and any delays throughout the system.
After the summer’s mishaps and poor performance, United has improved its on-time record. In particular, it said, arrivals on-time this month were 85 percent.
“We think we’re in a good spot given where we are in the merger,” said Peter D. McDonald, United’s chief operations officer.
Still, perceptions may be tough to fight, particularly online and in frequent-flier forums, where criticism of United’s service and performance has been particularly bitter. One critic, who goes by @FakeUnitedJeff, parodies Mr. Smisek on Twitter. One post last month read: “It’s raining in Newark. I wish we’d bought waterproof aircraft. Cancel, cancel, cancel.”
http://www.nytimes.com/2012/11/29/business/united-is-struggling-two-years-after-its-merger-with-continental.html?pagewanted=all&pagewanted=print |
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| From: zax | 12/30/2014 10:03:08 AM | | | | | | United Airlines sues 22-year-old who found way to get cheaper plane tickets
Posted 2:54 pm, December 29, 2014, by CNN Wire, Updated at 04:30pm, December 29, 2014
kdvr.com
NEW YORK — A young computer whiz from New York City has launched a site to help people buy cheap plane tickets. But an airline company and its travel partner want to shut him down. United Airlines and Orbitz filed a civil lawsuit last month against 22-year-old Aktarer Zaman, who founded the website Skiplagged.com last year.
The site helps travelers find cheap flights by using a strategy called “hidden city” ticketing.
The idea is that you buy an airline ticket that has a layover at your actual destination. Say you want to fly from New York to San Francisco — you actually book a flight from New York to Lake Tahoe with a layover in San Francisco and get off there, without bothering to take the last leg of the flight.
This travel strategy only works if you book a one-way flight with no checked bags (they would have landed in Lake Tahoe).
It’s not like these tickets are the cheapest all the time, but they often are.
In the lawsuit, United and Orbitz call Skiplagged “unfair competition” and allege that it is promoting “strictly prohibited” travel. They want to recoup $75,000 in lost revenue from Zaman.
</snip> Read the rest here: kdvr.com |
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| From: zax | 4/10/2017 2:29:07 PM | | | | | | United Airlines overbooks flight. Decides last minute to add a extra United staff ride-alongs as well.
Now the flight is overbooked by four. Asks for volunteers to get off. No one accepts.
So they chose four passenger at random - including a doctor - and told them to got off.
The doctor who had to see patients refused. So, they forcefully drag him off the plane.
WOW.
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| To: zax who wrote (89) | 4/11/2017 4:15:34 PM | | From: Glenn Petersen | | | | Consequences:
United Struggles to Extinguish Social Media Firestorm
by Michael Sasso, Justin Bachman, and Linly Lin
Bloomberg
April 11, 2017
-- ‘The most tone-deaf response I’ve seen,’ professor says
-- Airline becomes fodder for comedians on late-night TV
United Continental Holdings Inc. struggled to contain spiraling fallout over a passenger’s forcible removal from a flight as efforts at damage control fell flat.
Recordings of the incident posted on social media spread quickly around the globe and sent people into a rage. They showed officers pulling a passenger from a flight Sunday evening after he refused to give up his seat and then dragging him down the aisle as travelers yelled at them to stop.
The chilling scene was turning into a public-relations disaster for United, whose fumbling response only served to demonstrate how a normally routine consumer interaction can expand into a brand-damaging event in a world of smartphones and Facebook.
Oscar Munoz
Photographer: Andrew Harrer/Bloomberg
_________________________________
United Chief Executive Officer Oscar Munoz initially apologized for “having to re-accommodate these customers” but in a subsequent message to employees, the CEO called the passenger “disruptive” and “belligerent.”
“It was probably the most tone-deaf response I’ve seen to this type of issue -- possibly ever,” Scott Galloway, a professor of marketing at New York University, said on Bloomberg Television. “It’s as if they literally sat around and thought, ‘How could we make a bad situation worse.”’
Munoz on Tuesday offered his “deepest apologies for what happened” and said the airline would conduct a review of its procedures and policies to be completed by April 30.
“No one should ever be mistreated this way,” he said in a statement.
The stock dropped 1.5 percent to $70.46 at 3:28 p.m. in New York.
Joke Fodder
United was the butt of jokes by late-night comedians and by Tuesday in China, the incident was even a focus of social media and a government editorial. The hashtag #UnitedForcesPassengerOffPlane was the top trending item on Sina Weibo, the equivalent of Twitter, with more than 270 million views by evening in China. The man who was removed appeared to be of Asian descent.
China’s state mouthpiece the Global Times questioned in an editorial if “the victim’s Chinese ethnicity potentially made a difference” in how the passenger was treated. An online petition called “Chinese Lives Matter” calling for a U.S. investigation into the case has garnered 38,000 signatures.
In an ironic touch, Munoz just last month was named “Communicator of the Year for 2017” by PRWeek. The public-relations industry publication said Munoz “has shown himself to be a smart, dedicated, and excellent leader who understands the value of communications.”
Munoz received support from flight attendants. His letter to United workers Monday night was only meant to boost employee morale in a very trying time, said Sara Nelson, international president of the flight-attendants union for United.
“When something like this happens and people have to go to work and have order in their workplace to keep everyone safe, it can be incredibly demoralizing,” she said. “Some credit needs to be given to him.”
Routine Overselling
The incident showed how airline bumping can veer into confrontation. Carriers around the world routinely oversell their flights because people don’t always appear for a flight. Overselling is a way to cover that situation while maximizing the airline’s revenue.
The swift social-media condemnation, which extended to Washington, was sparked because the man wasn’t being ejected for misbehavior or a security threat. United said initially that the flight was overbooked, its staff chose him and he didn’t want to get bumped. The airline later said it needed room for its own employees to get to another flight.
Video posted to Facebook and Twitter showed the man being dragged out of his seat and down the aisle of Flight 3411 to Louisville, Kentucky, from Chicago. The man said he was a doctor and had to be in Louisville on Monday for work, according to a Twitter account by a passenger who said he was on the flight.
Crew Requirements
United required the seats on the Chicago plane to accommodate several crew members who needed to get to Louisville to avoid canceling other flights, spokesman Charles Hobart said. The flight wasn’t oversold, he said.
“It’s not something we want to do, but occasionally, it’s something we have to do,” Hobart said. “This was an instance where, unfortunately, we had to request the assistance of law enforcement because we had to get that aircraft off the ground.”
United’s response didn’t satisfy Senator Robert Menendez, a New Jersey Democrat, who called the incident “disturbing” and Munoz’s statement an “empty apology.” Eleanor Holmes Norton, a nonvoting House Democrat representing the District of Columbia, called for Congressional hearings.
Incremental Risk
The incident poses an incremental risk of inviting a response from lawmakers, Buckingham analyst Daniel McKenzie wrote in a note to investors.
“It’s a brand damaging event, but it’s unlikely investors will be able to pinpoint the fallout in UAL’s revenue production,” he wrote. Shareholders are more worried about competition and whether the carrier will miss revenue targets this summer as it increases seat availability, McKenzie said.
But NYU’s Galloway said “heads should roll” at United because it will cost the airline both in terms of direct response by passengers and in damage to its image longer term. Potential travelers finding similar fares on United and a competitor may choose the rival because of the video, he said.
“The airline industry is fairly competitive and often times you have more than one option at the same price,” he said. “At a minimum, this is a tie breaker. And in the airline industry, there are a lot of ties presented to consumers.”
The incident came two weeks after United drew social-media scorn for enforcing its dress code for people who fly as nonrevenue passengers, such as employees. A girl flying from Denver was told to change her leggings before boarding. In response, the airline then took efforts to tell “our regular customers” that “leggings are welcome.”
Carriage Contract
United’s contract of carriage says it chooses passengers to be bumped based on fare class, itinerary, status in its frequent-flyer program, “and the time in which the passenger presents him/herself for check-in without advanced seat assignment.” That means those who pay more for a ticket and those who fly the airline frequently are less likely to be selected for an involuntary bump, criteria that aren’t unique to the Chicago-based carrier.
A volunteer is paid for the seat and booked on another flight. But if there aren’t enough volunteers, an airline resorts to the involuntary method. When it goes wrong, it can get ugly. That’s one reason JetBlue Airways Corp., for example, doesn’t do it.
Last year, the 12 largest U.S. airlines bumped slightly more than 40,600 of 659.7 million passengers, for a rate of 0.62 per 10,000 passengers, down from 0.73 per 10,000 in 2015, according to the Bureau of Transportation Statistics.
bloomberg.com |
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| To: Glenn Petersen who wrote (91) | 4/12/2017 2:59:11 PM | | From: zax | | | | There is something particularly viral about inflicted traveling horrors.
The regulators are in the hands of the industry. I think that needs to change, because strictly speaking, the absolute horror which took place here appears to have been completely legal and negotiated in advance with the FAA. The airline can overbook, they can place strict limits on what the staff can offer as compensation when they do, they can push out seated, paid customers for last minute airline staff without as much as even seeking alternate transportation for that staff if no one accepts the limit, they can decide who get thrown off based upon arbitrary or self-interested criterion (i.e. the perceived value or age of the customer or their ticket class), they can refuse to take into account the customer's urgency and they can beat you, drag you off the plane and arrest you if you don't accept the "lawful" order to GTFO.
I hope this doctor gets the best legal representation possible and wins a huge settlement. The head of United should be "re-accommodated" with another job, his response - blaming the passenger - was appalling. |
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| To: zax who wrote (92) | 7/29/2017 12:00:45 AM | | From: Glenn Petersen | | | | The doctor did get a large settlement, though the amount was not disclosed. These incidents strike a sensitive chord and get publicized because they impact relatively affluent individuals. Drag one of the unwashed masses from a bus and you will not hear a beep. That does not excuse UAL for their behavior.
UAL appears to \have weathered the storm.
The Boycott That Wasn’t: How United Weathered a Media Firestorm
By JAMES B. STEWART
New York Times
JULY 27, 2017
A United Airlines jet at O’Hare International Airport in Chicago. Despite an embarrassing incident in which a passenger was dragged bleeding off a plane, the airline’s quarterly results were robust. Credit Kiichiro Sato/Associated Press
________________________________
After videos of David Dao, a medical doctor who in April was dragged kicking and screaming off an overbooked United Airlines plane, went viral and set off a global uproar, the outlook for United looked grim. Within days, the Twitter hashtag #BoycottUnited had been used over 3.5 million times.
Some took to Twitter to suggest new advertising slogans for United. “If we can’t beat out competitors, we’ll beat our customers” was one. “ United Airlines: putting the hospital in hospitality” was another.
Critics excoriated United for its handling of the crisis and especially its embattled chief executive, Oscar Munoz, whose first public statements seemed to blame the 69-year-old doctor for refusing to give up his seat. Mr. Munoz had already contended with a heart attack and heart transplant a month after becoming chief executive in 2015. Scheduled to be named chairman in 2018, he agreed to rescind that provision in his contract and may have his pay docked by the board.
So when United reported second- quarter earnings last week, many investors feared that the results might go off rose over 6 percent and profits shot up 49 percent. There was no sign of any boycott: The airline said it had 71 million passengers in the first half of the year, 4.2 percent more than the previous year.
Having recently completed a round trip from Newark to San Francisco on United, I wasn’t all that surprised a cliff just as the peak travel season was getting underway. But they were surprisingly robust: Revenue that United appeared to be weathering the storm. When I booked my ticket, United offered the most convenient flight options at the cheapest fares, albeit just $12 or so less than American. So I booked on United, even though the Dao incident was fresh in my mind.
My experience bears out an adage about airlines: People almost always opt for convenience and price, even while complaining loudly about crowded planes and a dearth of amenities. And now that there are just four major carriers in the United States, thanks to years of industry consolidation, many passengers don’t have all that much choice.
“The barriers to customer movement are pretty high,” Mr. Winston said. “You’d think that consumer perceptions matter a lot, but given that the major carriers practically have a monopoly on many routes and airports, it’s not that easy to switch.”
That said, once on board, I found the experience surprisingly pleasant. The flight took off on time and landed early. The snack I wanted was still available even though I was seated toward the back. My video screen malfunctioned, depriving me of an opportunity to watch the movie “Hidden Figures.” But the flight attendant was so empathetic, and tried repeatedly to fix the problem (rebooting the aircraft’s entire entertainment system several times) that I ended up reassuring her that I was happy to read a book. She gave me a voucher worth 5,000 frequent-flier miles or a $100 credit on a future flight, which seemed pretty generous for a minor incident.
The return trip was even better. The plane was a mint condition Boeing 777-300ER, with an intriguing business-class layout I admired while on my way to coach. Back there, the seats were leather and unusually comfortable (even for someone as tall as I am.) The video equipment worked. I was surprised when a flight attendant offered me a complimentary meal. I told her it must be a mistake since I was in an ordinary coach seat.
A United spokeswoman told me the airline had begun serving complimentary meals and drinks on many transcontinental flights beginning July 1, but only for Economy Plus passengers. She speculated that there may have been some extra meals on my flight, or I may have been upgraded to an Economy Plus seat without my realizing it. And she said the plane was probably one of the airline’s 11 new 777-300ERs, which are being broken in on transcontinental routes before moving to international ones.
The United Airlines check-in desk at La Guardia Airport in Queens. The airline has vowed to improve the customer experience. Credit John Taggart for The New York Times
____________________________
That flight also took off on time and landed early. (United said it had the best on-time arrival and departure performance of any carrier in the second quarter.)
Maybe this simply reflects diminished expectations, but after the remarkably stress-free flight, I wondered if it might be a good idea to fly an airline soon after an embarrassing episode like the Dao incident on the theory that everyone will be on their best behavior.
According to United, my experience wasn’t an anomaly, since the airline has put in a host of recent, post-Dao changes aimed at customer satisfaction. “To say we learned some lessons would be putting it mildly,” said Megan McCarthy, the United spokeswoman.
Besides the free meals and drinks in Economy Plus, United is now offering up to $10,000 in compensation for passengers who give up their seats on overbooked flights. These issues will be resolved before boarding so no one gets dragged off after taking an assigned seat. (United said “involuntary denied boardings” had dropped 88 percent in June from a year earlier.) When the airline loses luggage, customers will no longer have to provide receipts to prove the value of what was in it. The airline will provide up to $1,500 in compensation, no questions asked.
United has also set up a team based in Chicago to offer creative solutions to customer problems. Ms. McCarthy cited an example of providing a flight to a nearby airport and ground transportation to their destination if someone has been denied boarding on an overbooked flight.
After floundering for a few days after the Dao incident, Mr. Munoz seemed to get his mojo back. He apologized personally to Dr. Dao, and United settled with him on terms that, while they haven’t been disclosed, left Dr. Dao’s lawyer singing the airline’s praises. Mr. Munoz went on “Good Morning America” and said he felt “shame” when he saw the video. He apologized and vowed that it would never happen again on a United flight. In May, he took his mea culpa to Congress, where lawmakers used the opportunity to beat up on him for a host of perceived customer frustrations with airlines. “Ultimately our actions will speak louder than words,” he told them.
“That was the right thing to do,” said Steve Barrett, editor of PRWeek magazine. “They should have done it immediately. United made it a much bigger story than it ever would have been.”
PRWeek was thrust into the somewhat awkward position of criticizing Mr. Munoz’s handling of the affair less than a month after it had honored him as “c ommunicator of the year,” the public relations equivalent of an Oscar, for his rehabilitation of the airline’s tattered image and for reaching labor agreements that had eluded United management for years. The magazine didn’t retract the honor, but after the Dao incident Mr. Barrett said, “The episode and subsequent response will be quoted in textbooks as an example of how not to respond in a crisis.”
When I spoke to Mr. Barrett this week, he acknowledged that no boycott had materialized and United’s bookings were holding up, helped in part by a series of incidents at rival airlines suggesting that United wasn’t any worse.
(This month, the conservative pundit Ann Coulter blasted Delta Air Lines for forcing her out of a preferred seat she’d booked on a flight from La Guardia Airport in New York to West Palm Beach, Fla. The airline refunded the incremental $30 cost of the preferred seat but accused her of slandering the airline and its employees.)
Still, United “has suffered considerable reputational damage,” Mr. Barrett said. “No one is going to forget that video anytime soon.”
United is tying executive pay (not just Mr. Munoz’s) to customer satisfaction, and in its recent earnings report included a section on the “customer experience.” The airline said it would continue its renewed focus on the customer.
“That’s great and I hope it’s true,” Mr. Winston said. The airlines “have spent the last 30 to 40 years building a culture that’s about maximizing profits. Employees and customers were just a cog in that strategic wheel. Maybe it takes an incident like this to make them realize they can be about something more than moving cattle in the cheapest possible way.”
nytimes.com |
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